Investment Advice and the Personnel Practitioner

Abstract

Personnel practitioners face an increase in employee demand for financial advice as the complexity of the financial industry and investment opportunities continue to escalate. But personnel practitioners need to understand the change which has taken place in the investment industry in recent years and the legal dangers of offering what could be classified as investment advice. In directing employees to a source of investment advice, the onus will be on personnel practitioners to suggest how the employee should select an investment adviser. Furthermore organisations need to recognise the existing lack of personal financial management skills amongst employees. This lack is responsible for creating additional wage pressures as employees seek to maintain the level of purchasing power of their earnings and offset their lack of financial skills. Training employees to manage their personal financial affairs could create less pressure on the wage spiral and contribute to the meeting of employee value systems.